• Gold prices rose on Wednesday to a one-week high on a weaker dollar following U.S. Secretary of State Rex Tillerson’s sudden dismissal, which invigorated concerns of protectionist policies hampering global risk appetite.
Spot gold rose 0.12 percent to $1,327.56 per ounce at 0402 GMT. It touched $1,329.22 an ounce during the session, its highest since March 7.
U.S. gold futures for April delivery rose 0.09 percent to $1,328.20 per ounce.
• On Tuesday, President Donald Trump fired Tillerson after a series of public rifts over policy on North Korea, Russia and Iran, replacing his chief diplomat with loyalist CIA Director Mike Pompeo.
• Risk aversion is back on the table following the unexpected news of Tillerson’s dismissal and the appointment of Pompeo, said OCBC analyst Barnabas Gan.
“Pompeo is a supporter of Trump’s trade policy and could help advance his agenda of imposing it on U.S. trading partners ... all this uncertainty and risk aversion leaves gold as a safe haven option,” Gan added.
• “With the U.S. protectionist rhetoric likely to ring equity market alarm bells, gold should continue to be an ideal hedge in this highly unpredictable environment,” said Stephen Innes, APAC trading head at OANDA.
• Meanwhile, data on Tuesday showed U.S. consumer prices cooled in February amid a decline in gasoline prices and a moderation in the cost of rental accommodation, the latest indication that an anticipated pickup in inflation probably will be only gradual.
• “The percent increase in consumer price index suggests it won’t be enough to spur more rate hikes by the Fed than already expected,” ANZ analysts said in a note.0.2
• Spot gold may rise to per ounce, as it has cleared a resistance at , according to Reuters Technical analyst Wang Tao.$1,334$1,327
• In other precious metals, silver rose percent to per ounce.0.5$16.62
Platinum gained percent to $per ounce and Palladium edged percent higher to $per ounce.0.3 964.50 0.1 991.47
• GOLD CONTINUES TO TRADE HEAVY, SHORTS FAVORED ON UPSWINGS
Gold is generally a mess and favors traders fading price swings. On the top-side, the trend-line continues to be a focal point for sellers while the area just above a spot which buyers are stepping in. Overall, gold is heavy, but shorts remain favored on upswings as choppy market conditions prevail.2013 1300
Reference: Reuters, DailyFX
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